Can Communication Tools be Unified?

By CIOinsight |
Posted 07-05-2005

Can Communication Tools be Unified?

Promise

Employees and IT folks are both looking for better communications tools.

When it comes to digital communications, convergence is like the Grand Unified Theory: a single solution that remains frustratingly undiscovered. The promise of one software suite that combines VoIP, e-mail, instant messaging, collaboration, document workflow and Web conferencingand delivers them all through a single user interfaceis tantalizingly close. Alas, it's been that way for the better part of two decades. "It's the Nirvana that everyone has been talking about for 20 years," says Sara Radicati, president of the research firm Radicati Group Inc.

As perpetually disappointing technologies go, the idea of converged communications solutions has had a remarkably long shelf life. But why? All kinds of reasons. Salespeople think that listening to their e-mails over their cell phones would be cool. Internal auditors dream of quickly tapping into one source to find every e-mail, voice mail, IM and document they need in order to ensure compliance with federal regulations. Product engineers envision global collaboration with far-flung marketing and sales teams. And managers want to be able to keep tabs on their subordinates through presence awareness technologies.

IT managers have their own dreams. They see a single, affordable, easy-to-manage, easy-to-integrate software application that encompasses all of their company's communications needs. They imagine managing one network for voice, data and video, rather than three.

This is the promise of a unified communications system. Less cost, higher productivity. At least, that's what some would have you believe. Yes, the promise of a unified communications network is grandin theory. In practice, however, not only is there no such thing as a truly converged platform, but the patchwork style alternatives can actually end up costing you more, and increasing complexity. "It would be great to have one communications pipeline to do all this stuff," says Radicati. "But the world is a complicated place, and no one is pulling it off."

Ask your line-of-business managers:

Are your current communications tools serving your needs?

Ask your cto:

What kind of research have we done into next-generation communications?

Remind your executive team:

We need to be cautious about deploying technology that may have no strategic value to the enterprise.

ZIFFPAGE TITLEReality

At the moment, the unified communications market isn't really unified at all. No one vendor currently offers an application that encompasses the gamut of messaging and communication features that a unified system would ideally include. This often forces companies to purchase more than one application, which adds cost and complexity to the equation. As a result, these firms are still missing out on many of the benefits of a truly unified system.

That was the case for Ephraim Cohen, co-owner of the Fortex Group LLC, a small marketing and public relations firm in New York City. When it first opened for business in 2003, Fortex used Yahoo! for free e-mail and instant messaging. But it quickly became clear that the company would need a more secure and customizable application. So Cohen began researching options. "It was frustrating because no one has an all-in-one solution," he says. Furthermore, many of the applications out there were too expensive for Cohen's small start-up. Finally, Cohen settled on BlueTie Inc. for his company's e-mail and calendaring needs, on Teleo Inc. for VoIP, and on Trillion Digital Communications Inc. for instant messaging. Although each tool works well independently, "If one application could do all of it at a low cost, I would go with them," Cohen says.

In part because of the lack of one complete solution, integrating these applications with each other, as well as with systems already in place, can be a much greater obstacle than companies anticipate. When its 16-year-old PBX system began to fail, the law firm of Leonard, Street and Deinard, in Minneapolis, decided to replace it with an IP network. The firm turned to Avaya Inc., which helped create a messaging platform that includes VoIP, calendaring and Web conferencing. The system linked to the firm's Microsoft Outlook e-mail program without too much trouble, but integration -problems still plagued the rollout, says Carol Reitzel, the firm's telecom analyst. "We've had some struggles," she says. The new system "has increased the complexity of everything because it needs to be so deeply integrated into a multitude of other applications." For example, the law firm keeps track of all its phone calls through a billing program from Equitrac, but at first it wouldn't mesh with Avaya's software. It took a considerable amount of troubleshooting before the IT team could get things up and running. "Because things are no longer in silos, the interdependency makes it more complex to pinpoint and resolve issues," Reitzel says.

In addition, it's not cheap. The firm, which has 450 users of the new system, shelled out almost $1 million for the initial rollout, including consulting fees, installation, and unanticipated integration issues. As it turns out, it costs 3 percent more to maintain the new system than it did to maintain the old one.

Of course, the attorneys are thrilled with the new system, she adds. The firm has five offices with 190 lawyers in Min-ne-sota and Washington, D.C., and moving to VoIP puts everyone on a 4-digit dialing system. Calls that come into a lawyer's office can also ring through to his or her mobile phone. Employees can check voice mail from their e-mail inboxes, and e-mail (as well as access calendars, contact lists and other tools) from their voice mail. Rietzel claims that the ability to collaborate makes the rollout valuable, although "it would be nice to say that there will be a cost benefit. Our main focus is to provide improved client services."

Ask your CTO:

What kind of integration issues are we likely to encounter should we pursue unified messaging?

Ask your telecom manager:

When do you expect we will make the shift to IP telephony?

Tell your CFO:

If we move on this now, it is likely to cost us more than we're spending now.

ZIFFPAGE TITLEValue

Value

Convergence costs moneyand ROI is hard to come by.

Although vendors claim cost savings as a benefit to convergence, many companies, such as Leonard, Street and Deinard, actually report increased spending as a result of their new rollouts. Costs vary, but vendors report that a communications platform that includes VoIP, IM, Web conferencing and calendaring capabilities could cost more than $60 per employee just for the license, not including installation, consulting, and other related fees. Gartner Inc., however, puts the price tag much higher, saying that systems could cost up to $400 per user. "It's a significant investment across the board," says Jim Murphy, a senior analyst at AMR Research Inc. For that reason, he says, be cautious when evaluating new software. "You don't want to be too aggressive when adopting this technology, because it may mean overspending," he says.

For the most part, companies that have installed a new communications platform are too early into their deployments to benchmark its success. And the few companies that can report actual ROI are using their systems to address very specific needs. At Birmingham, Ala.-based Pemco Aviation Group Inc., a $201 million global maintenance, repair and overhaul servicing company for the aerospace industry, Director of IT John Griffith was looking for a cost effective way to upgrade the company's order and billing process. Because the company works with so many differentand often very low-techparts manufacturers, Pemco receives thousands of faxes, and had hundreds of fax machines throughout its headquarters and three satellite offices.

Griffith wanted to integrate the faxes into the company's e-mail program. "We started looking at plug-ins to our Microsoft Exchange e-mail application and licenses from Microsoft, but it started getting expensive." So expensive, he says, that it made an entire communications suite from Oracle Corp. look cheapand that's what he ultimately chose to install. "It was very attractive from a management and cost standpoint," he says. Although he won't share exact figures, Griffith says, "We started out with a ten-month ROI target, but it only took six months to save the money we spent on the system." Faxes are now delivered directly to e-mail inboxes as TIF files, saving the company thousands of dollars in paper costs and fax machine equipment. Today, the same two people who once managed just e-mail now take care of e-mail, voice mail, fax, Web conferencing and calendaring.

But saving money on a few fax machines is hardly enough justification to invest in a communications overhaul. And the potential for increased productivity, which is widely touted as the largest benefit these systems provide, is always difficult to measure. "Productivity alone is difficult to sell to anyone in the enterprise user base," says Murphy of AMR.

Ask your chief strategist:

Which departments would benefit the most from a converged communications system?

Ask your line-of-business managers:

Do you have specific problems that a unified messaging system could address?

Ask your CFO:

What kind of budget can we allocate to pure productivity enhancements?

ZIFFPAGE TITLEFuture

Future

Emerging standards could improve unified messaging's prospects.

By 2010 analysts expect more partnerships between vendors, thanks to widespread adoption of the SIP and SIMPLE standards for IP telephony, IM and presence awareness. This will ease integration woes and help companies extend their messaging and communication capabilities beyond the firewall. It would enable a company to use an internal communications system to incorporate an offshoring partner into a document workflow, or to collaborate on a project with a third party. At the moment, these interactions happen mainly by e-mail and fax. "Standardization will help interoperability, but right now it's still a big hurdle," says Erica Rugullies, a senior analyst with Forrester Research.

That's because the playing field is still highly fragmented with small vendors that are more interested in grabbing market share by adding mediocre bells and whistles to their already limited offerings, rather than truly rounding out their product offerings or even conforming to standards. "The temptation is to add more features and see what sticks with the customer," says Radicati. A Web conferencing vendor might add IM and presence services to its software package, for example, or an e-mail provider might create a nifty way to connect calendaring to its core product. And only a few of these applications currently include VoIP. Standards would at least make it easier for companies to connect disparate tools from different vendors.

Even the vendors that have the potential to offer complete solutions are not playing nice. Oracle, Microsoft, AT&T and others are hitting the streets over the next six months with the first all-in-one communications software packages. But their platforms are built using different standards. So if your company uses Microsoft, but your outsourcing partner uses Oracle, the systems won't connect. Analysts say this will change within a year or so as companies more widely adopt SIP and SIMPLE as the de facto standards. "That's where everyone is coalescing," says Forrester's Rugullies.

It's important to think ahead and begin evaluating how your company will take advantage of these new tools, especially as organizations move more and more to embrace VoIP. But for now, a truly converged network is still as elusive as Einstein's theory for everything. "It's appealing," says AMR's Murphy, "but so far, unproven."

Ask your biggest partners:

What kind of messaging systems are you using that we could integrate with?